Pharmasim Case Summary

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Executive Summary
As the brand manager for Allround cold medicine, there were many decisions regarding product formulation, strategy, line extensions and product launches over the company’s last 10 periods. The brand was focused on remaining a profitable, mature product family within the cold medicine category, but also maintaining a premium brand image.

ALAN’S INITIAL STRATEGY. Please add, it should only be around 1 paragraph.

After a period of declining sales for Allround, we increased the advertising budget to be consistent with our competitor’s budget. We decided to be very consistent with our strategy over the ten periods; however, in hindsight we should have implemented a more dynamic strategy that factored in the changing
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We decided this extension would be successful, as it would cannibalize of Allround sales the least. Even though the alcohol was dropped from Allround, doctors and pharmacists recommended expectorant in the children’s version over the cough suppressant in Allround. As a result, our product choice was successful.

In period five, we introduced the line extension Allright; a 12-Hr muli-symptom relief capsule. We decided this extension would be successful, as the allergy market is very small and had an entrenched competitor. Therefore, while we were aware of potential cannibalization, we believed that the targeted market (retirees, empty nesters, and young singles) would have sufficient demand for our product. We also reasoned that this target was far enough removed from Allround’s to gain additional market share without taking any from Allround. However, this was not the case, as cannibalization was a pressing issue. Market share was gained at the expense of Allround.

The AllStar brand was viewed as the premium brand on the market, this was reflected by the pricing schemes of Allround and Allround+. However, Allright was launched to be a flanker brand to capture market share from price-sensitive consumers without hurting Allround’s brand image. Allround and Allround+ were priced as high as possible within the bounds of the price-effectiveness trade-offs. This trade-off was also the basis for Allright pricing decisions, however, we could never increase the price fast

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